Conversion Rate Optimization: The New Competitive Edge

According to a study by eConsultancy, 78% of marketers are dissatisfied with the conversion results of their website. What’s behind this figure? The first question that any company that wants to grow through digital marketing must ask itself is: How much of my budget is spent to bring qualified visitors to my website and how much is spent to make sure that these visitors are converted? Often the answer to this question is dramatically unbalanced towards acquisition, while conversion rate optimization only gets the scraps in the best of cases.

Factors influencing the conversion rate of a digital property

Working on improving conversion rates is certainly not an easy job: the conversion rate (i.e., the ratio between the conversions obtained and the users who visited the website or app) can be influenced by many factors:

  • The relevance of the offer with respect to the target audience – is likely that a new mother will be more interested in buying baby clothes on an e-commerce website than a teenager. The more my offer is relevant to the target, the higher the conversion rate will increase;
  • The fame and reputation of a brand – it is easier to sell something to a user who knows you, or even someone who has already purchased from you, rather than to a user who has never heard of you. This is particularly important when dealing with products or services with a very high value. While we can trust any Internet seller if we have to buy a simple ream of paper, we will be much more selective if we have to buy a copier;
  • Cost and perceived value of the product – some products, by their nature, have higher conversion rates than others, simply because some products have a different cost. The conversion rate of a website that sells luxury watches worth a few thousand euros will probably be lower than an e-commerce website that sells nail polishes. For the same reason we can expect to have an even higher conversion rate when the product we offer is free, such as a PDF ebook. Attention: the cost of the product must always be taken into account compared to the value of the product as perceived by the user. The higher the perceived value compared to the cost, the more the user will be willing to convert;
  • Product Life Cycle – Some products have lower conversion rates because they have a longer life cycle. For example, an ERP software for large companies will have a lower conversion rate than a smartphone, because when a company chooses software it usually keeps it for several years;
  • User Experience – the presence of obstacles due to a bad design negatively influences the conversion rates, creating real architectural barriers that make the lives of users more difficult;
  • Quality of the contents – text and images can positively or negatively influence the conversion rates because they are the main vehicle by which the offer is illustrated to the potential buyer;
  • Diversity between devices and platforms – depending on the product we can have very different conversion rates between desktop and mobile devices or Android and iOS systems;
  • Location and user behaviour by geographic area – The conversion rates of an e-commerce website that targets the Italian public will generally be lower than one that targets the U.S. public. This in turn depends on many other factors such as the general public’s confidence in online shopping.

The multidisciplinary competences of a CRO Specialist

A multidisciplinary approach that combines very different skills and often speaks different languages is indispensable to manage all these factors.

The CRO team should have at least these core skills:

  • Web Analytics – Analysis of user behaviour data collected from web analytics platforms is the starting and ending point of a conversion rate optimization We need to know how to use Google Analytics, Hotjar, Omniture, KISSmetrics and other platforms to identify opportunities for improvement and potential problems in the conversion funnel and after the intervention we need to know how to measure the impact of our solutions to the problems identified;
  • User Experience – We need to build a coherent, clear and effective navigation experience to make our users’ lives easier and avoid frustrations and obstacles that could draw them away from the conversion path. Therefore, we need to be able to draw on the body of studies and best practices in the user experience field but, above all, we need to be able to ask the right questions and listen to the answers of our users;
  • Copywriting – No matter how sophisticated our digital marketing tools are, our message is always conveyed through images and words. We need to be able to leverage them effectively by creating compelling stories that touch the right buttons in the minds of our target audience;
  • Psychology – To obtain a conversion we need to be able to persuade our users, directing them towards the behaviour we desire. The study of psychology offers us reference models that describe the mechanics of the decision-making process, models that become indispensable for preparing effective messages;
  • Statistics – We need to be able to move between some fundamental concepts of statistics to be able to design solid tests that generate valid and statistically significant results

Working on improving conversion rates is therefore a complex and difficult matter to deal with but on the other hand the power of an improvement, even limited, in conversion rates is enormous: in fact, the conversion rate is a multiplier of the value of the marketing budget and is therefore one of the digital marketing investments that is able to bring the greatest return on investment.

Still few companies in Italy have embraced the theme of Conversion Rate Optimization with a continuous and structured approach. This means that those who start first and are able to build a mature approach in a short time will have a huge competitive advantage over their competitors.